A landmark San Diego restaurant may see its lease lapse

Craig Ghio, chief executive of Anthony's Fish Grotto, walks near the landmark restaurant on San Diego's waterfront. The Port District is debating whether to renew its lease or replace it with one of two other restaurant ventures.

Oct. 18, 2015 5 PM PT

Reporting from San Diego — For seven decades, Anthony’s Fish Grotto has been a landmark on this city’s downtown waterfront — offering gorgeous views, an informal atmosphere and reasonable prices.

It was a leader in modernizing the waterfront and helping transform San Diego from a one-horse Navy town to a mega-tourism destination.

But in recent years Anthony’s has lost some luster as newer restaurants have crowded into the downtown Gaslamp Quarter and attracted younger, more affluent tourists and locals.

Now the Port District, which controls the property beneath Anthony’s, is debating whether to renew its lease or replace it with one of two other restaurant ventures vying for the prized spot. The issue returns to the Port Commission on Nov. 17.

Port staffers snubbed Anthony’s when they picked two finalists, but a port commissioner, Robert Valderrama, objected: “This is gnawing on me.” At his insistence, Anthony’s was given a second chance.

Anthony’s owners, the Ghios — particularly the late Catherine “Mama” Ghio — were pioneers in San Diego’s coming of age after World War II. The family helped establish the tourism and convention bureau.

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“The young staffers at the port have no sense of San Diego’s history, no sense of the contributions of our family,” said Craig Ghio, one of Mama’s grandsons and now Anthony’s chief executive.

Not so, says Port Commission Chairman Dan Malcolm.

The port has a fiduciary responsibility to increase lease profits and Anthony’s has been underperforming, he said. From those profits, the port is able to build parks and other public amenities.

“Anthony’s for a long time has achieved true [icon] status,” Malcolm said. “But this is also a time when we have a great piece of property and a 40-year license coming up.”

Even the two other bidders have shown some remorse at seeking to oust Anthony’s.

“I have tremendous respect for the Ghio and Mascari families and what they’ve accomplished through the years. But this is such a good business opportunity,” said Mike Morton Jr., chief executive of the locally owned Brigantine restaurants.

Like many San Diegans, Morton has fond memories of special occasions at the waterfront eatery. “When we would go to Anthony’s, it was a big deal,” Morton said.

Greeter Mary Cobb, 72, has worked at Anthony’s for 43 years.

“I’m here to see that everyone gets a good table and has an enjoyable meal,” Cobb said, breaking off momentarily to bid goodbye to two lunchtime diners.

Business leaders admire the Ghios, but Anthony’s has never been a favorite of critics and foodies.

Craig Ghio, 63, can recite from memory some hostile reviews. “She was snobby,” he said of one critic. “A great plate of fish and chips didn’t make it for her — oh well.”

Catherine Ghio opened the original Anthony’s near the then-ferry landing in 1946. The 16-seat diner was named for her grandfather and St. Anthony, the patron of fishermen.

The restaurant moved to its current location in 1965, with a 52-year lease. Mama Ghio ran the restaurant with a firm hand. Even in her final years, she would make unannounced inspections.

“If the celery wasn’t chopped right, or the carrots were too big, or the consistency of the clam chowder wasn’t right, you heard about it,” Ghio said. Her portrait hangs in the entry.

As it promises to upgrade the menu, Anthony’s also vows that some things will remain. Anthony’s will still serve “Mama Ghio’s famous clam chowder,” according to documents filed with the port.

Each of the three finalists has promised $12 million to $15 million in new construction, with plenty of glass and metal and outdoor seating. The port wants construction to begin in early 2017, after the current lease is up.

For its bid, Anthony’s has teamed with the managers and partners of the Fish Market, a popular restaurant adjacent to the Midway carrier museum.

The Brigantine proposal includes Miguel’s, a Mexican restaurant, and Brigantine itself, known for its restaurants in Point Loma and Del Mar. “We hope to activate the waterfront, bring in more energy, more diversity,” Morton said.

The third proposal, from Sunroad Enterprises, includes five eateries on two levels. The partners have successful restaurants throughout the region, including the Blue Point Coastal Cuisine in the Gaslamp.

In a recent year, Anthony’s reported revenue of $10 million. Sunroad predicts that its annual revenue would be $22 million to $31 million, and Brigantine predicts $20 million to $25 million. Anthony’s predicts a similar figure. With greater revenue, the lease payments to the port will increase.

Port District staff originally chose the Brigantine and Sunroad proposals for the commission’s consideration after reviewing ownership experience, management teams, food and service concepts, and construction plans, said Penny Maus, the port’s real estate program manager.

Now the staff is set make another recommendation, choosing among Brigantine, Sunroad and Anthony’s.

“We really respect them and their legacy,” Maus said of Anthony’s. “But for the port, this is a really exciting opportunity.”

Craig Ghio has heard this talk before from the port.

“It’s all about the money,” he said, glancing up at the portrait of his grandmother. “That’s sad. Every city needs a classic restaurant. In San Diego, that’s Anthony’s.”

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Twitter: @LATsandiego

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